Case Law Details
Raj Sheela Growth Fund (P) Ltd Vs ITO (Delhi High Court)
The case of Raj Sheela Growth Fund (P) Ltd vs. ITO (Delhi High Court) revolves around the crucial question of jurisdiction in income tax assessment proceedings. The crux of the matter lies in whether the absence of a transfer order under Section 127 of the Income Tax Act allows a non-jurisdictional Assessing Officer (AO) to proceed with the assessment.
In this case, Raj Sheela Growth Fund (P) Ltd, a private limited company, filed its Income Tax Return (ITR) for the Assessment Year (AY) 2015-16 before the Central Circle-20, New Delhi. However, despite the centralization order granting jurisdiction to Central Circle-16/20, New Delhi over the assessee’s case, the assessment proceedings were initiated by the Income Tax Officer (ITO) Ward 21(1), New Delhi, without any formal transfer order.
The crux of the dispute lies in the validity of the assessment conducted by ITO Ward 21(1), New Delhi, in the absence of a transfer order under Section 127 of the Income Tax Act. The assessee contends that without a transfer order, the case cannot be transferred from one AO to another, as mandated by Section 127 of the Act.
On the other hand, the Revenue argues that the inherent jurisdiction of ITO Ward 21(1), New Delhi, is established through a combination of an order dated 15.11.2014 passed under Section 120 of the Act and a CBDT notification dated 22.10.2014. The Revenue contends that such jurisdictional orders negate the necessity of a transfer order under Section 127 of the Act.
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